AI Ads: A New Frontier for Nonprofits

This week on the Nonprofit Newsfeed the hosts dive into a game-changing announcement from OpenAI that could revolutionize nonprofit marketing strategies. OpenAI has revealed plans to pilot advertising on ChatGPT, marking a significant shift in how nonprofits might engage with audiences.

Key Highlights:

OpenAI’s Announcement: OpenAI is testing ads in select markets for ChatGPT’s free and low-cost tiers, aiming to provide more users with access to its AI tools without usage limits. Implications for Nonprofits: With approximately 800 million weekly active users, ChatGPT offers nonprofits a vast audience for targeted advertising. This presents an unprecedented opportunity to engage users during meaningful conversations across diverse contexts, from education to health advice. Concerns and Opportunities: While the prospect of ads in AI raises concerns about data privacy and the influence on AI-generated content, it also opens doors for nonprofits to reach audiences in innovative ways. The challenge will be crafting ad content that complements AI interactions without disrupting user trust. Transparency and Analytics: The move towards advertising may also introduce valuable analytics tools, enabling nonprofits to gain insights into user behavior and optimize their engagement strategies.

Nonprofit Wellness Index Update:
The podcast also highlights Whole Whale’s Nonprofit Wellness Index, which tracks sector health through job postings, layoffs, and ad spending. December’s index hit a record high, indicating a positive rebound from previous lows, suggesting a revitalized nonprofit sector.

Feel-Good Story:
In a lighter segment, the hosts share a unique fundraising initiative from an Alaskan bird conservation group. For Valentine’s Day, donors can name a rat after an ex, which will then be fed to a bird of prey, offering both cathartic satisfaction and support for wildlife conservation.

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Podcast: Play in new window | Download

This week on the Nonprofit News Feed, brought to you by Whole Whale, a B Corp digital agency. My name is George Weiner. I am the chief whaler and founder of Whole Whale, and huge nonprofit geek, but you know that, if you’ve listened to this podcast at all. I also have Nick Azulay, digital strategist at Whole Whale. Nick, we’ve been looking through the news. We’re in January. It’s January 21st as we’re recording this. I feel like something big happened over the weekend, at least an announcement. What did we see come across our desk? George, we had a big announcement from the likes of OpenAI this weekend. A big announcement in particular, if you work in social impact marketing, and that is that OpenAI has announced they are beginning to pilot advertising on ChatGPT. What does this mean? Let’s dive into this announcement. First, I just want to say on the onset that this is not live yet. That we can tell. It appears they’re testing it in limited markets and some kind of a beta, but there’s no advertising infrastructure that’s been broadly rolled out yet. This mostly exists in the form of a press release, but we do want to go through that press release because it gives us something, gives us a lot to think about, and we need to highlight it for this audience as AI continues to completely upend how audiences engage with our nonprofit organizations. George, OpenAI said that they’ve been working to make powerful AI accessible to everyone through free product and low-cost subscriptions. George, that includes the free version of ChatGPT and this new thing called ChatGPT Go, which is, to my understanding, a very lightweight model designed for low-income countries. But George, what they’re doing is they’re going to start to plan for ads testing in the US for the free and Go tiers. So, quote, more people can benefit from our tools with fewer usage limits or without having to pay. They’re framing this, George, as a, hey, you know, you want it for free? Now you need to give us something in the form of, you know, whatever insane amount of data that you’re now giving up to OpenAI. And they go through their ads principles, mission alignment, answer independence. They say, conversation privacy, we keep your conversations with ChatGPT private. Great, but somebody knows what you’re typing, at least vaguely, even if it’s anonymized. So, George, ads and AI are here. Ads for ChatGPT are here, and they will be fully rolled out, I’m guessing, within the next couple months. What do nonprofits need to know? I think this is an exciting opportunity to explore a new medium for advertising and for reaching an audience where they are. That is what advertising has always been, and that started with the, you know, ads in newspapers, taking up that type of real estate that offsets the cost of the printed word on the page. It is a new day, same game. I’m excited, because actually, you know, aside from, I have concerns, but I’m just going to speak from the excitement side of things, is that with 800 million, thereabouts, weekly active, I think, and climbing users, your audience is there. There are a lot of folks having a lot of conversations. Over half of those conversations, based on that September analytics report from OpenAI, over half of those conversations are non-work-related. But the truth is, this is an unprecedented level of access to communicate with advertising, to communicate to people having real conversations in depth on topics that may be aligned or adjacent to what you work on. I mean, it’s weird, but there are people that use this for a therapist. There are people that use this for executive coach. There are people that use this for health advice. There are people that use this for education. There are people that use this for work. There are people that use this for fill-in-the-blank. And if your organization is interested in reaching people when they are in that mindset and having that conversation, the ability to target the not just demographic, psychodemographic, but also moment when somebody’s there is very interesting to me and hopefully presents a tremendous opportunity for nonprofits trying to provide the type of support and guidance from a trusted source on a topic. What I hope I don’t see is that advertising actually influences the context window in any way of the output of that AI. What we have seen so far from AI overviews and the advertising that is now the inventory related to that, and we have a webinar coming up, do check us out for that coming up in the end of January here, is that the ads show up around, above and below, but not in the response. And I think that’s important because if you begin to pollute the data sources that the AI is relying on for the answer, you have ruined, capital R ruined, that AI, its trustworthiness, wherever it is, is eviscerated. So I think the architects are aware of that and acknowledge that. And if it happens, then it’s just game over for the solution. The truth is, there’s no such thing as a free lunch. We already knew that they were using our data when you weren’t paying for it. Even sometimes when you are paying for it and you don’t uncheck the box. But now it’s clear that the cost of running these things indefinitely for free is not sustainable. Ads were inevitable. And so I choose to say, hey, let’s pay attention to where the opportunities are. Just as in the early days of Facebook advertising, in the early days of Google ads, holy cow, could you get a deal? Well, people are like, oh, I don’t know. I’m going to wait and see. Like, we’re going to be testing. We’re on the list. I sometimes also get a little exhausted with the announcement and then sort of silence afterwards. Like, what did you announce? It’s like the sign in the bar that says free beer tomorrow. Come back tomorrow, free beer tomorrow. And this felt like a little free beer tomorrow to me. Like they announced the thing and they just don’t have it. So we’re on the waiting list. We’re seeing, and we’re seeing how our clients might benefit from a test ad spend on the platform. But of course, you’re going to want to measure. I think there’ll be issues with click-through rates for sure because we have already seen that having that AI overview and having that answer already sort of essentially synthesized and given by the AI means the reason, especially if it’s informational, like people need to discover the answer to X is gone. So I think there’s going to be a big difference in how that ad copy goes into play from this, like, learn more about that. Like the AI has already frankly told them about whatever that topic is. So where does your ad fit in that nuance is curious to me. Yeah, George, I think you hit on a lot of key pieces on the visibility note and the click-through rate note. It’s also interesting how and if advertising placements will impact organic link clicks from AI results, right? A lot of our clients see thousands, tens of thousands of sessions directly from LLMs, particularly our larger ones and whether advertising distracts from that will also be interesting, right? Pushing down, if you will, organic search results, that’ll be interesting. Something else to note, George, is that TrackGPT, OpenAI rather, notes that during our tests, we will not show ads and accounts where the user tells us or we predict that they are under 18 and ads are not eligible to appear in your sensitive or regulated topics like health, mental health, or politics, which is interesting, George. We see those types of health and mental health restrictions across the platform, but it looks like TrackGPT is going down the realm of no political ads, which is probably a net positive, right? But there’s also, there’s repercussions for that, right? That’s kind of, you know, you’re privileging certain aspects of the economy and not others. That’s a whole different discussion. So it remains to be seen broadly what this means, but I think, George, I have concerns about what an advertising economy means in AI because that experience is so much more intimate than even something like a Google search, right? And I wonder what the downstream consequences of that will be What I do know is that for nonprofit organizations that have quality content and the ability to shape what ethical advertising looks like on those platforms can’t afford to just be hands off and sit on the sidelines, right? What does this look like? How can you help find audiences and connect audiences with your resources? So this is a whole new frontier, George. And I think that these markets, right, this is what open AI is setting up. They’re setting up market. They’re setting up little insular market economies. And how this kind of plays out remains to be seen, right? What are costs going to look like? What’s inventory going to look like? Et cetera, et cetera. It looks like we’re kind of having text-based ads at this point, kind of akin to a Google search ad. It doesn’t look like in-stream video at this point or anything like that. But there’s a lot of unknowns here. Again, kind of vague-ish announcement from opening AI, but we’ll see what this means because it’s going to mean a lot one way or another. How great would it have been if they just went straight old school AOL homepage and been like, you get a banner, you get a banner, and it’s going to be a GIF. I don’t know. Maybe I’m too old. Man, GIFs, yeah. The other thing they note here is they have this note, and I’ll quote it, conversation and privacy. We keep your conversations with ChetchiPT private from average advertisers, and we never sell your data to advertisers. They state that and then also proceed to literally say, we’re going to let advertisers advertise against essentially the theme and content of your conversations. So I think gold medal for the mental gymnastics linguistic skill displayed by the person that wrote that or the AI that wrote that because I don’t think I can hold those two thoughts in my head without it imploding into a black hole. I’m also excited here about the fact that in order to enable ads, you have to do another critical thing, which is add transparency about impressions and impressions around a theme, impressions regionally. The reason we have Google Analytics for free is because of the beautiful advertising engine that prints money like no other system in corporate history for Google with their Google Ads. That’s why we got Google Analytics for free. And Google Analytics is a tremendous tool for understanding behavior. Right now, we have been operating in this black box for three plus years for who, what, when, where, how queries are happening. We get this sort of batch reports that come out sporadically. We got that one from OpenAI back in September, which was a very interesting report, but doesn’t allow filtering, doesn’t allow logging. So what I’m hoping to see as we are waiting here, certainly at Whole Whale, where we care a lot about the analytics of things, is what information can we glean from looking at the volume based on theme targeting around the keywords or concepts that we’d be advertising for. It’s very interesting to us. Yeah. For those listeners who are kind of less in the weeds, what George is asking about… Our listeners, I’m sorry. These listeners are freaking… They’re in the weeds. You are gardeners. I’m sorry. If you’re listening to this, especially at this point, gardeners welcome. Come on now. What I will say is essentially what we’re interested to see is in some way advertisers will have access to the volume of impressions that searches for the Empire State Building or how to bake a cheesecake. We’re going to start having specific volumes in some way, whether that’s impressions or clicks or whatever. We’re going to start to get data from the inside of this thing that, as you said, has been a black hole of nothing specific. We shall see, George. This is a major change in the game. George, my last question on this topic is, do you think that the other models are going to follow? I suspect your answer is probably, but is open AI kind of trying to get out ahead of the field here? Are they risking alienating their user base? Do they think that, hey, we’ve kind of dominated the market so far? The kind of competitive dynamics of this are kind of interesting to me. I mean, the truth is this is a company that is burning money every single day. It is desperate for these revenue models to offset. I want to look it up, so I’m going to look it up. How much AI, how much do you think they’re losing per day? Oh, it’s got to be tens of millions of dollars a day, is my guess. You’re pretty close. Based on 2025 estimates, open AI is spending roughly $15 million a day. The truth is you need something here, right? And if people don’t want to pay for it and they’re, obviously, they’re paying in their data, but it is an inevitability also, I think, for other models. You cannot offer this top tier, frontier models or even tier two models that, based on this increasing insatiable demand for free, you just kind of have to run those ads. Interesting times, George. All right. I think that was kind of, that wraps our discussion up on AI advertising for now. We’re going to be talking about this with every new development because this is, I think, George, safe to say, potentially the biggest change in digital advertising since the ability to advertise on Web 2.0 social media platforms. This is kind of next-gen advertising here, so we’ll continue to talk about this. Yeah. And it’s going to be tough because folks like you who are old-school SEO and understanding things are thinking about keywords. And I think keywords are dead. I think it’s concepts. I think it’s thinking in psychodemographics. I think it’s in emotional targeting because all of those things are… Yeah. I’m excited for this new chapter. The old one was, I was getting tired of that book. Yeah. Hey, well, the book, the new series is out. All right, George. Our last thing that we want to talk about is the Nonprofit Wellness Index. George, this is a proprietary index that we at Whole Whale created. What does it do? It measures nonprofit sentiment across the sector in semi-real time because the numbers we get from the Labor Department, we get, what, every couple years or so. This gives us a monthly breakdown of nonprofit sector health. It measures things like job posting layoffs and advertising spend as proxies for sector health. George, what was the key takeaway from our most recent monthly data? Yeah. So again, thank you for walking us through what it is, and we share it every month. And it’s tough because we adjust it constantly. And in doing that, I’m sharing the screen for those people watching poorly. Stop sharing this. But here we go. On this, we have a record high for December of 3.75. And that number doesn’t really matter out of context. In context, this is the highest recording. This is from a zero to four rating, but it’s weighted against all of our historical data. And again, we’re pulling data from various sources, including Idealist LinkedIn, meta ads library around charities and nonprofits. We’re pulling from Glassdoor and other unemployment data. And we’re merging that all together to get an idea of the health, health as measured by that proxy, as you mentioned, for employment and whether or not nonprofits are advertising. And the number and direction has gone up since June. The numbers when we started, to give you an idea, it was below two and we had a rough summer. It starts to climb a bit as we move into October and November and then hitting a high in December. Now, these numbers may be lower in the future, but this directionally is showing that the nonprofit sector is beginning to rebound from the dramatic cuts and downturn that we saw, I think a historical lows in 2025. So I think we’re seeing things pull in the right direction and we can break this down by Glassdoor, LinkedIn, meta ads and see this. There was a sudden bump. There was a big bump in Glassdoor postings for nonprofit related jobs that went away. So maybe like a bit of a seasonal bump. And so over time, this is just going to get frankly smarter and give us a better pulse on what’s going on as we move into the year over year. And job counts that happened for these things. All right. I’ll stop the share. Thanks, George, for that insight. Before we let everyone hop, George, word on the street is you have a quick cheeky joke. Not just joke. I have the feel good story. So I want to call out a very clever tactical Valentine’s Day focused fundraising idea being pushed out there by a group. And I’m pulling this up. This is the it’s an Alaskan group that does bird conservation and they essentially are titling it Love Hurts the Valentine’s Day for those hurt by love. And essentially you can name a rat after an ex or somebody that has wronged you. And one of their delightful birds of prey will eat that rat and they will record this rat getting eaten. I think it’s brilliant. Brilliant. Absolutely brilliant. So they’ve got the Raptors revenge, for instance, for just fifty dollars. You can relish a video of a snowy owl ghost or a bald eagle basically consuming a frozen mouse or rat symbolizing your ex. So, you know, make it make it happen. I think there’s something very cathartic about that. And by the way, you’re helping Alaska’s wild bird population. I love that George. Nothing says the season of love like revenge and retribution. OK, here’s my dad joke. You ready? All right. Why do frogs just like love working with fundraising databases? I don’t know, George. They just really enjoy eating whatever bugs come out of those CRMs. I see. Love eating bugs. Nonstop bugs. Salesforce joke. Nonprofit database administrators don’t think I pay attention. I read the comments. Those are those are the real heroes.

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The post AI Ads Are Here: A New Frontier for Nonprofits (news) first appeared on Nonprofit News Feed.